What Are PAYG Withholding Tables?
PAYG withholding tables are ATO-published lookup schedules that tell employers the exact dollar amount of income tax to deduct from each employee payment. The Australian Taxation Office updates these tables at the start of every financial year to reflect changes in income tax brackets, the Medicare levy, and any legislated offsets such as the "Low Income Tax Offset" (LITO) or the "Low and Middle Income Tax Offset" (LMITO, now expired).
Every Australian employer, payroll software provider, and business accountant relies on these PAYG withholding tax tables to calculate the correct deduction for wages, salary, commissions, bonuses, and director fees. The tables cover weekly, fortnightly, and monthly pay cycles, and separate schedules exist for residents, non-residents, working holiday makers, and payments subject to study and training loan repayments. For FY2025-26, the tables incorporate the Stage 3 tax cuts that reduced the 32.5% marginal rate to 30% and raised the $120,000 threshold to $135,000.
Employees do not need to manually consult the tables themselves. Payroll systems apply the correct withholding automatically based on the employee's TFN declaration answers. However, understanding how the tables work helps you verify your payslip, estimate your take-home pay before accepting a job offer, and anticipate your annual tax refund or tax debt. Use our Income Tax Calculator to check your withholding against the ATO tables instantly.
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Calculate exact PAYG WithholdingHow Does PAYG Withholding Work?
PAYG withholding works by requiring employers to deduct estimated income tax from every payment and remit it to the ATO before the employee receives their net pay. The system ensures that taxation occurs incrementally throughout the year rather than as a single lump-sum bill in July.
The withholding process follows a precise sequence from the moment an employee starts a new job through to the end of the financial year:
- Employee submits a TFN declaration — The employee completes a Tax File Number declaration form (NAT 3092) providing their TFN, residency status, tax-free threshold claim, and study loan status. This form determines which withholding schedule the employer applies.
- Employer identifies the correct schedule — Based on the declaration, the employer selects from Schedule 1 (standard), Schedule 2 (no TFN), Schedule 3 (actors/performers), Schedule 4 (return-to-work), or Schedule 15 (working holiday makers).
- Payroll calculates gross earnings — The employer totals the employee's ordinary time earnings, overtime, allowances, bonuses, and commissions for that pay period.
- Withholding amount is looked up or calculated — The employer uses the ATO coefficient formula or a direct lookup table to determine the exact PAYG withholding for that gross amount. The formula uses two coefficients (a and b) applied to weekly earnings brackets.
- Net pay is deposited — The employer pays the employee the gross amount minus PAYG withholding, minus superannuation (paid separately to a super fund at the SG rate of 12%), and minus any salary sacrifice or other deductions.
- Employer remits withheld amounts to the ATO — Withheld tax is reported and paid to the ATO, either monthly (for businesses withholding over $25,000 per year) or quarterly (for smaller withholders), via the Business Activity Statement (BAS).
- Annual reconciliation via tax return — At year-end, the employee lodges a tax return. The ATO compares total PAYG withheld against the actual tax liability. Any overpayment results in a tax refund; any shortfall results in a tax debt.
The withholding tables assume you earn the same gross amount in every pay period for the full 52 weeks (or 26 fortnights, or 12 months). Employees with irregular income, multiple jobs, or mid-year start dates frequently receive a refund because the annualised projection overestimates their total taxable income. Use our Tax Return Calculator to estimate whether you are likely to receive a refund or owe additional tax.
Weekly Tax Table Reference
The following shows approximate weekly PAYG withholding amounts for the 2025-26 year. Assumes Australian resident claiming the tax-free threshold with no HECS debt.
| Weekly Gross Pay | Estimated PAYG Withheld | Est. Weekly Take-Home |
|---|---|---|
| $350.00 | $0.00 | $350.00 |
| $500.00 | $38.00 | $462.00 |
| $1,000.00 | $148.00 | $852.00 |
| $1,500.00 | $298.00 | $1,202.00 |
| $2,000.00 | $458.00 | $1,542.00 |
| $3,000.00 | $866.00 | $2,134.00 |
*The ATO tables round calculating factors so manual formula results may vary by a few cents. Calculate exact weekly pay here.
Fortnightly Tax Table
A standard fortnightly pay cycle (26 pays per year) applies the following estimated withholding. Assumes Australian resident claiming the tax-free threshold with no HECS debt.
| Fortnightly Gross Pay | Estimated PAYG Withheld | Est. Fortnightly Take-Home |
|---|---|---|
| $1,000.00 | $76.00 | $924.00 |
| $2,000.00 | $296.00 | $1,704.00 |
| $3,000.00 | $596.00 | $2,404.00 |
| $4,000.00 | $916.00 | $3,084.00 |
| $6,000.00 | $1,732.00 | $4,268.00 |
Monthly Tax Table
Monthly cycles (12 pays per year) apply the following estimated withholding. Assumes Australian resident claiming the tax-free threshold with no HECS debt.
| Monthly Gross Pay | Estimated PAYG Withheld | Est. Monthly Take-Home |
|---|---|---|
| $4,000.00 | $530.00 | $3,470.00 |
| $6,000.00 | $1,100.00 | $4,900.00 |
| $8,000.00 | $1,720.00 | $6,280.00 |
| $10,000.00 | $2,440.00 | $7,560.00 |
| $15,000.00 | $4,575.00 | $10,425.00 |
What Schedules Exist in the PAYG System?
The ATO publishes 6 main withholding schedules, each targeting a specific payment type or employee category. The schedule your employer uses determines the withholding rate applied to your gross pay.
| Schedule | Applies To | Key Feature |
|---|---|---|
| Schedule 1 | Regular wages and salary for residents | Includes tax-free threshold option, Medicare levy built in |
| Schedule 2 | Employees who have not provided a TFN | Flat rate of 47% from the first dollar |
| Schedule 3 | Actors, performing artists, company directors | Adjusted withholding rates for lump-sum or variable payments |
| Schedule 4 | Return-to-work payments, compensation | Separate coefficient formula for irregular income streams |
| Schedule 5 | Lump-sum termination payments (ETP) | Concessional cap amounts and separate withholding rates for over/under preservation age |
| Schedule 15 | Working holiday makers (subclass 417 & 462 visas) | Flat 15% rate on the first $45,000, then resident marginal rates above |
Schedule 1 applies to the vast majority of Australian employees. It contains sub-tables for claiming and not claiming the tax-free threshold, and additional coefficients for employees with HECS-HELP, VSL, SFSS, or TSL study and training debts. For more on study loan repayments and their withholding effect, see our HECS-HELP Repayment Guide. Working holiday makers operate under a completely different tax regime — our Working Holiday Tax Guide explains the rates and thresholds in detail.
How Do You Use the PAYG Tax Tables?
Employers use the PAYG tax tables by matching an employee's gross pay period earnings to a corresponding withholding amount using either a lookup table or a coefficient formula. Modern payroll software performs this calculation automatically, but manual users follow a specific process.
Lookup Table Method
The ATO publishes PDF and CSV tables listing the exact withholding amount for every dollar increment of weekly earnings from $1 to $3,461+. Employers find the row matching the employee's weekly gross pay and read the withholding amount in the applicable column (with tax-free threshold, without tax-free threshold, with HECS, etc.). For fortnightly pay, the employer doubles the weekly gross, looks up the withholding, and applies it. For monthly pay, the employer multiplies the weekly gross by 4.3333.
Coefficient Formula Method
For payroll software and employers processing high volumes, the ATO provides coefficient pairs (a and b) for each earnings bracket. The formula is:
Weekly withholding = (a × weekly earnings) − b
For an employee earning $1,500 per week and claiming the tax-free threshold, the applicable coefficients for the $1,282–$2,307 bracket in FY2025-26 produce a withholding of approximately $298. The resulting weekly take-home pay is $1,202. These coefficients already incorporate the 2% Medicare levy and the LITO reduction, so employers do not need to calculate those components separately.
PAYG Withholding vs PAYG Instalments — What Is the Difference?
PAYG withholding applies to employees receiving wages, while PAYG instalments apply to self-employed individuals, sole traders, and investors earning non-salary income. These are two separate ATO systems with different payment mechanisms, reporting obligations, and collection frequencies.
| Feature | PAYG Withholding | PAYG Instalments |
|---|---|---|
| Who pays | Employer deducts from employee wages | Individual or business pays directly to the ATO |
| Income type | Salary, wages, commissions, bonuses | Business income, investment income, rental income |
| Frequency | Every pay cycle (weekly, fortnightly, monthly) | Quarterly (via BAS or instalment notice) |
| Rate basis | ATO tax tables with coefficient formula | ATO-issued instalment rate or fixed instalment amount |
| Threshold to enter | All employees earning $1+ per week | Business/investment income that generates a tax liability of $1,000+ |
Contractors and sole traders who do not have tax withheld from their invoices enter the PAYG instalments system instead. Our Contractor vs Employee Guide explains the tax, super, and withholding differences between these two work arrangements. If you operate as a contractor, use our Contractor Pay Calculator to estimate your quarterly instalment obligations.
How Do TFN Declarations and Withholding Variations Affect Your Tax?
The TFN declaration form is the single document that controls which withholding rate your employer applies to your pay. Every answer on this form shifts the calculation in a measurable way.
- Tax-Free Threshold: Claiming this threshold (usually on your primary job) instructs your employer to use the standard table where the first $18,200 of your annual income is untaxed. This reduces your weekly withholding by approximately $67 compared to not claiming it.
- No Tax-Free Threshold: For a second or third job, you do not claim the threshold. Your employer uses a higher withholding table, taxing you from the very first dollar at the 16% marginal rate (plus 2% Medicare levy).
- Study/Training Loans: Ticking "Yes" to having a HECS-HELP, VET Student Loan, or SSL debt triggers a combined table that deducts both PAYG tax and loan repayments simultaneously. Repayment rates range from 1% to 10% depending on your assessable income bracket.
- No TFN provided: Failing to supply a valid TFN within 28 days triggers the top marginal rate of 47% from dollar one, with no tax-free threshold or offsets applied.
What Is a Withholding Variation?
A "Withholding Variation" (also called a Section 15-15 variation) is a formal ATO approval that allows your employer to withhold a different amount than the standard tax tables prescribe. Common reasons for applying include large work-related deductions (such as $5,000+ in tools or uniforms), significant rental property losses creating negative gearing, or salary sacrifice arrangements that reduce assessable income. The employee applies directly to the ATO, which issues a letter specifying the varied withholding rate. The employer then applies that rate instead of the standard tables until the variation expires at the end of the financial year.
Salary sacrifice arrangements for superannuation, novated leases, and other pre-tax benefits also modify the withholding calculation. See our Salary Sacrifice Guide for the impact on your take-home pay and taxable income.
What Changed in the PAYG Withholding Tables for FY2025-26?
The FY2025-26 PAYG withholding tables reflect the Stage 3 tax cuts that took effect on 1 July 2024 and continue into 2025-26, along with an increase in the superannuation guarantee rate from 11.5% to 12%.
| Change | Previous (FY2023-24) | Current (FY2025-26) |
|---|---|---|
| 19% bracket ceiling | $45,000 | $45,000 (unchanged) |
| Middle rate | 32.5% | 30% |
| 30% bracket ceiling | $120,000 (at 32.5%) | $135,000 |
| 37% bracket ceiling | $180,000 | $190,000 |
| Top marginal rate | 45% above $180,000 | 45% above $190,000 |
| Medicare levy | 2% | 2% (unchanged) |
| SG rate | 11% | 12% |
The practical impact for a worker earning $90,000 per year is a reduction in annual tax of approximately $1,929 compared to the pre-Stage 3 rates, translating to roughly $37 more per week in take-home pay. The updated income tax brackets apply to all residents, and the withholding coefficients in the ATO's published tables have been recalculated accordingly. Check the full breakdown of each marginal rate in our Tax Brackets Guide.
The superannuation guarantee increase to 12% does not directly change the withholding tables, but it affects the total employer cost per employee. Your employer now contributes $10,800 in super on a $90,000 salary. Our Superannuation Calculator shows the exact SG contribution based on your salary.
How Do You Convert Net Pay Back to Gross Salary?
Reverse-engineering your gross salary from a known take-home figure requires working backwards through the PAYG withholding tables, adding back the tax, Medicare levy, and any HECS repayments that were deducted. Job advertisements increasingly quote "take-home" or "net" amounts, making this conversion essential for comparing offers.
A net weekly pay of $1,202 corresponds to a gross weekly salary of approximately $1,500 (or $78,000 per year) for a resident claiming the tax-free threshold with no study loan. The relationship between net and gross is non-linear because of progressive marginal rates — each additional dollar of gross pay is taxed at a higher marginal rate. Use our Gross Pay Calculator to reverse-engineer the PAYG withholding instantly from any net figure.
Frequently Asked Questions
How this calculator works▼
Calculations and table estimates are based on the latest ATO PAYG withholding tax tables for the 2025-26 financial year incorporating Stage 3 tax cuts.
Sources & References
- 1ATO Tax tables— Australian Taxation Office
- 2Weekly tax table— Australian Taxation Office
- 3Fortnightly tax table— Australian Taxation Office
Last verified: 14 March 2026. Our content is based on the latest information from official Australian government sources.
James Harrington
Verified AuthorSenior Tax & Payroll Analyst
CPA, Registered Tax Agent (25787011)
James is a CPA-qualified tax professional with over 14 years of experience in Australian taxation and payroll systems. He spent six years at the Australian Taxation Office working on PAYG withholding and individual tax return processing before moving into financial publishing. He now leads the tax content at Pay Calculator Australia, translating complex ATO legislation into clear, actionable guidance.
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